finance homework week 6 ch 13

finance homework week 6 ch 13 - Problem 1324 Treynor Pie...

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Problem 13-24 Treynor Pie Co. is a food company specializing in high-calorie snack foods. It is seeking to diversify  its food business and lower its risks. It is examining three companies—a gourmet restaurant chain, a  baby food company and a nutritional products firm. Each of these companies can be bought at the  same multiple of earnings. The following represents information about all the companies. Company Correlation with Treynor Pie Company Sales ($ millions) Expected Earnings ($ millions) Standard Deviation in Earnings ($ millions) Treynor Pie Company. .... + 1.0 $100 $8 $2.0 Gourmet restaurant. ........ + .6 60 6 1.2 Baby food company. ....... + .2 50 4 1.8 Nutritional products company. ......................... − .7 70 5 3.4 Question 1
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1 / 1 point a) Which is the least risky company? Question options: A) Gourmet restaurant B) Baby food company C) Nutritional products company Question 2
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This note was uploaded on 05/15/2011 for the course FINC 350-A taught by Professor Mason during the Spring '09 term at Columbia College.

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finance homework week 6 ch 13 - Problem 1324 Treynor Pie...

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